Introduction to Financial Accounting

Go to Course: https://www.coursera.org/learn/wharton-accounting

Introduction

### Course Review: Introduction to Financial Accounting on Coursera **Overview:** If you're looking to demystify the world of financial statements and gain technical skills crucial for financial analysis, then the "Introduction to Financial Accounting" course by The Wharton School on Coursera is an excellent starting point. This course walks you through the fundamental aspects of financial accounting and equips you to analyze financial statements, understand accounting standards, and appreciate the inputs that drive the financial reporting process. By the end of your learning journey, you’ll have acquired the ability to read and interpret three core financial statements: the income statement, balance sheet, and the statement of cash flows. ### Course Structure: The course spans over four weeks, each structured to build upon the knowledge gained in the previous week while being engaging and hands-on. Here’s a breakdown: #### **Week 1: Introduction and Balance Sheet** The course kicks off with a foundational look at financial reporting. You’ll be introduced to essential concepts like the balance sheet equation—Assets = Liabilities + Stockholders' Equity. By delving into debit-credit bookkeeping, you will learn to translate business transactions into understandable formats. This week’s material serves as the cornerstone you need to fully grasp the language of accounting. #### **Week 2: Accrual Accounting and the Income Statement** As you transition to the second week, you’ll uncover the nuances of accrual accounting. You’ll explore how revenues and expenses impact the income statement and learn the significance of adjusting and closing entries. The emphasis on working with a case study of a start-up company keeps the content relatable and practical. #### **Week 3: Cash Flows** “Cash is King!” This week emphasizes the importance of cash flows, categorizing them into operating, investing, and financing activities. You’ll get hands-on experience preparing and analyzing the Statement of Cash Flows, illuminating the connections between earnings and actual cash from operations. A notable highlight is the real-world application of your learned skills on the business case you’ve been following. #### **Week 4: Ratio Analysis and Final Exam** The final week revisits core concepts with a focus on ratio analysis. Here, you’ll learn how to break down financial performance through various ratios, enhancing your understanding of the functionality behind the numbers. The review sessions prepare you for the final exam effectively, ensuring you're well-equipped to showcase your newfound knowledge. ### What Makes This Course Stand Out? 1. **Practical Focus**: The inclusion of case studies ensures that learners can apply theoretical knowledge to realistic scenarios, an essential aspect of mastering financial accounting. 2. **Engaging Format**: The course is interactive, and participants are encouraged to stay involved through quizzes and practice exercises that reinforce learning. 3. **Expert Instruction**: Delivered by renowned faculty from The Wharton School, you’ll benefit from insights and knowledge from some of the leading minds in business education. 4. **Flexible Learning**: As an online course, it allows for a self-paced learning experience, making it suitable for both students and working professionals. ### Final Recommendation: The "Introduction to Financial Accounting" course on Coursera is a highly recommended choice for anyone—regardless of background—seeking to boost their financial literacy. Whether you're planning to jumpstart a career in finance or simply want to manage your finances more astutely, this course lays a solid foundation for your understanding of financial accounting principles. After completing this course, you won’t just impress your family, friends, and coworkers with your new knowledge; you’ll also be equipped to make informed financial decisions in your personal and professional endeavors. So, if you’re ready to unlock the world of financial statements, consider enrolling in this impactful course today.

Syllabus

Week 1: Introduction and Balance Sheet

To learn a foreign language like Accounting, you need quite a bit of practice in the basic foundations (grammar, syntax, idioms, etc.). This material is absolutely essential for being able to read and to understand books written in the language (in our case, financial statements.). This week, we will start building these foundations. We will start with an overview of financial reporting. What types of reports are required? Who makes the rules? Who enforces the rules? Then, we will cover the balance sheet equation and define/discuss Assets, Liabilities, and Stockholders' Equity. We will introduce debit-credit bookkeeping and do lots of practice in translating transactions into debits and credits. Finally, we will introduce a case of a start-up company to provide you insights into all of the steps necessary to go from recording the first transactions of a new business all the way through its first set of financial statements.

We will start with a discussion of Accrual Accounting and how it affects the recognition of the Income Statement accounts: Revenues and Expenses. Then, we will cover adjusting entries, which are needed to prepare our internal books for the upcoming financial statements. Finally, we will discuss closing entries and the preparation of the Balance Sheet and Income Statement. At each stage, we will continue to work on the case of our start-up company. If you are not sick and tired of journal entries by the end of this week, then I have not done my job!

Cash is King! We will start with the classification of cash flows into operating, investing, and financing activities. Then, we will work on preparing and analyzing the Statement of Cash Flows. We will wrap up the case on the start-up company by preparing and analyzing its Statement of Cash Flows. Finally, we will discuss the differences between Earnings, Cash from Operations, EBITDA, and Free Cash Flow.

We will have our final exam this week. Because of the exam, I will cover Ratio Analysis, which will not involve any "new" material. While we will define and discuss a number of ratios, they will all basically involve dividing one accounting number by another. But, the analysis of what those ratios mean will involve a deep understanding of Balance Sheet and Income Statement accounts. Thus, the Ratio Analysis videos will help provide a nice review of the material, which will help you prepare for the exam. However, there will be no questions about ratio analysis on the exam. The only thing left to do after this exam is to impress your family, friends, and co-workers with your vast knowledge of Financial Accounting!